KARACHI, Feb 19: Cotton market on Tuesday lacked normal trading interest as spinners and mills kept to the sidelines followed by reports of higher arrivals of phutti into the ginneries and perceptions of a comfortable supply position through the season.
Owing to late sowing of the current cotton crop, the arrivals of phutti are picking up each fortnight ensuring adequate supplies of lint to mills and spinners at a competitive price.
According to figures released by the Pakistan Ginners Association (PCGA) for the fortnight ended Feb 15, the arrivals were only 2.01 per cent lower as compared to over 30 per cent earlier, reflecting the growers are now not inclined to hold on to their positions anticipating further increase in prices.
The total arrivals were at 9.423 million bales as compared to previous season’s 9.615 million bales, out of which spinners have so far purchased 7.502 million bales, needing another 2.5 million bales to meet their annual consumption demand.
The other buyers including the TCP and the private sector exporters have purchased 0.122 million and 47,128 bales, respectively.
Floor brokers said the unsold stock at 1.803 million bales though was still on the higher side, the fall below the two million bales mark appears to be a good sign and could easily be absorbed by the mills.
“But what worries them the slow pace at which mills and spinners are buying lint apparently to keep prices within the prevailing levels,” they added.
Market sources ruled out possibility of any big turnaround until spinners decide to resume normal trading activity, needed at this time of the season.
As was expected re-entry of the TCP or the exporters failed to give any boost to prices as their intake is too small to influence the price line on the higher side, they claim.
Of late some of the leading exporters are seen in the market and are covering their forward positions on a modest scale, notably of inferior lots below Rs1,500 per maund.
Ready offtake was light as spinners were conspicuous by their absence as steady arrivals of phutti kept them in a positive frame of mind. As result, about 2,000 bales of inferior quality changed hands, purchased by the exporters: 1,200 bales of Sanghar at Rs1,300 and 500 bales of Haroonabad at Rs1,450.